Spain Above European Average in Rate of Bad Loans
The IMF forecasts that Spain will be within the group of European economies that recorded a higher rate of bad loans above the European average along with France and Italy, because these countries have a high rate of loans on total assets, according to the Barcelona Reporter. As far as estimates of losses for banks and financial institutions are concerned, their financial losses for the period 2007/10 could be around 412 million euros to 2.3 billion euros, but warned that risks to global financial stability "remains high". The IMF reiterated, however, that one of the risks weighing on the global economy is the continued weak housing market, citing Spain, along with Ireland and Britain, as one of the markets with higher pressure, which have suffered significant price declines. The institution also had a few words about the Spanish government efforts to alleviate the financial crisis and stressed that the fund created for the restructuring of banks can provide a barrier against "systemic risk" and that the newly established Banking Ordinance Restructuring Fund (Frob) could also promote a process of consolidation among banks. Read more.